NEW DELHI: Gross foreign direct investment (FDI) into India rose 13.6% to $81 billion during the last financial year, the fastest pace of expansion since 2019-20.The increase in the year was despite a contraction seen during the fourth quarter of 2024-25 when inflows on a gross basis declined 6% to $17.9 billion, probably due to the uncertainty caused by Donald Trump’s election and his assertions around getting investments back into the US.On net basis, however, FDI declined 97% to $353 million due to large scale repatriation out of the country, driven to an extent by overseas investors such as Hyundai cashing out through initial public offers.Latest data released by RBI pegged repatriation and disinvestment of stake in India at Rs $51.5 billion in 2024-25, 16% higher than the previous year. As a result, FDI into India was estimated at $29.5 billion.After you factor in FDI by India – which shot up 75% to $29.2 billion – net inflows barely remained in the positive zone. During the last fiscal year, Indian companies invested $17 billion in equity capital overseas, which was 87% higher than the previous year.“FDI inflows into India have shown a healthy trend, but with more India companies showing global investment appetite, net inflows have been impacted,” a top policymaker said.Govt has been trying to push FDI into the country as it seeks to tap into growing appetite among global investors to diversify beyond China. But, by all accounts companies have opted to invest in Vietnam and Mexico and the task has become more difficult with Trump pushing companies, including the likes of Apple, to invest in the US.Global agencies as well as domestic economists have called for govt to push a fresh set of reforms, including notification of the labour codes and making it easier for companies to acquire land.
